Sweepstakes Scams

Most online sweepstakes are legitimate, but fraud exists everywhere and flourishes online. This section will help you spot scams, and hopefully avoid a bad situation.

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Yellow Light - Caution

Use caution with events that:

Red Light - Run Away!

Never enter events that:

Use Caution With These Types OF Events:

Events That Do Not Provide Adequate Information

       Some online events will not provide an official rules section, or much other information for that matter.  Most of them are legitimate, but if an event seems to be overly vague about key information, it could be an indication that something’s not right.  If they also don’t provide a means of contacting them, don’t be too enthusiastic about winning a prize from them. And obviously you also don’t want to send them any money up front for any reason. 

 

Events That Require An Upfront Fee

       Some events operate like a raffle. They will collect an entry fee from everyone who enters. Usually these events will be canceled if there are not enough entries. Be sure to find out what happens to your entry fee if the event is called off. There are also events that require a registration fee. Only certain kinds of “registration fee” events are legal.  If an event is collecting an entry fee or requiring a purchase to enter, it could be an illegal activity.  Anytime you’re paying to enter an event be sure to read its official rules, and check out the source carefully.

       If you have been notified that you have won a prize and are asked for a “refundable” deposit, shipping charge, or any type of fee, be very cautious.  Some events require you to pay shipping charges on prizes won, but should clearly reveal this fact at the time of entry.  Also be EXTREMELY cautious if you are asked to supply credit card information

 

Events Ask You To Dial A Telephone Number

       If you are instructed to dial a long distance number to claim a prize or enter an event, be careful.  In fact, if you are asked to dial a phone number for any reason with an area code you do not recognize, check it against our area code list.  This list was set up to help you identify the region a questionable area code refers to, and which ones not to call.  In a recent phone scam, victims received a message saying that they have won a prize and need to call a number to claim it. There are other variations on the message as well including; you owe money, someone has died and left you an inheritance, someone you know has been arrested, etc...  They are all designed to get you to dial a number, and keep you on the line as charges pile up. (Sometimes as much as $25.00 a minute!) Check our area code list before you dial the number, or you might have a very unpleasant surprise when your phone bill arrives.

       Sometimes scammers will also set up 1-900 numbers because they can be confused with 1-800 numbers.  900 numbers are not free, and in fact you can be charged extreme rates for calling one.  When dialing a 1-900 number, make sure you know what the rates are ahead of time.

Stay Away From These Types:

Events That Ask You For Credit Card Or Bank Information.

       Cases have been reported of event winners being asked to supply this type of information since it's needed to verify their eligibility, to deposit winnings in their account, or that a payment is required to “release” their prize.  DO NOT give credit card or bank information to anyone online unless you are sure of their validity.  Using credit or financial information to verify identity or eligibility is simply not done. It is also very unusual for winnings to be direct deposited unless the event is being hosted by a bank or credit union.  If an event offers to redeem your prize in this manner, they should give you other redemption options as well.  If they insist that direct deposit is the only way to collect your winnings, but their official rules said nothing about this being done, you may be dealing with a scam.  It’s also very unusual for a down payment to be required to “release” a prize.  In fact, this type of operation is almost always illegal.

 

Events That Require You To Pay Them Taxes On Winnings.

       Never pay anyone taxes on winnings directly. Only government agencies collect taxes.  If you are asked by anyone involved with an event to pay them taxes, report them to the IRS on the tax fraud e-mail hotline: hotline@nocs.insp.irs.gov or by phone: 1-800-829-0433.   (Talk about releasing the hounds!)

Phone Scams

   Phone scams are very popular with con artists since it’s difficult to trace the source, and even harder to prove exactly who the conversation has taken place with. This means it’s not easy to catch and prosecute phone scammers.  Phone scams often target the elderly, but anyone can become a victim.

   One of the most common types of phone scam involves notifying the intended victim of a Grand Prize they have won. These claims of sweepstakes winnings are bogus of course, but serve to snag the unsuspecting person on the other end of the line. After convincing the victim of their good fortune, the scammer will have some cleaver way of getting them to send money.  A professional scammer can make the reason for sending cash sound completely reasonable and logical.  One of the more recent ploys is to tell the victim that they need to set up an account, or buy something for tax purposes.  Anytime you are contacted with good news from an unknown source and asked to send cash for ANY reason, keep your guard up.

  Most people think they could never be taken by a scam of this sort, but it can happen to even the most savvy of us.  The words of an unknown con artist say it best: “No matter how smart you are, there’s a scam out there that can get you.”

   On the other hand, you don’t want to be overly cautious either.  Many legitimate events notify prize winners by phone. We’ve heard of some winners being so jumpy when receiving the call, that they’ve hung up on genuine prize winnings!  If you are notified by phone that you have won a prize, remember this little fact: Federal law requires that tele-marketers calling to award prizes must reveal that no purchase or payment is necessary.   If you are contacted by someone who asks for payment as a stipulation for you receiving your prize, simply hang up on them (not before telling them exactly what you think of their sleazy ways of course!), wait a few seconds, then pick up the phone and dial * 5 7 then hang up again. This will store the source of the last call you received.  You can then contact your local police or phone company to report the incident, and let them know you’ve dialed * 5 7.  This does not work with all telephone service carriers, but will work with many.

Final Words About Sweepstakes Fraud

   Trust your instincts. If something about an event doesn’t feel quite right, be cautious. If you suspect an event to be a scam, don’t supply them with any information that you wouldn't feel comfortable releasing to the general public. And when you see the words, “Congratulations! You’re a winner!”, be skeptical. Don’t get so caught up in the excitement of winning that you drop your guard. That’s just what scammers are counting on.

   This has been a walk through the dark side of hypersweeping.  Don’t let it discourage you though. It accounts for a very slim minority of online events. You will probably never encounter a serious “sweep-scam”, but they do exist. If you practice safe sweeping though, you can avoid being taken, and still win a prize once in a while!

 

Been Scammed?

  If you or someone you know has been taken by a dishonest online sweepstakes, please let us know.  This way we can keep this section updated and help warn others.

  You can also report a recent case of Internet fraud to The National Fraud Information Center, and The Federal Trade Commission.

  The Better Business Bureau is of course always a good place to go when dealing with a corrupt company.

  In order to file these complaints you will need the physical address and telephone number of the offending site. If you cannot find that information at the site (which you probably won’t if they are pulling a scam), you can find that information by going to http://www.networksolutions.com/cgi-bin/whois/whois and enter the domain name of the company. You’ll get all the information you need. If they are a sub-domain of a larger one like “Yahoo” or “Xoom”, contact the administrators of the larger domain and report your displeasure. This may or may not have an effect depending on the type of offense, and the governing domain’s policies.

   Have fun, and be careful out there!

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